Arvest Bank will host a groundbreaking ceremony to mark the start of construction on a new branch location in Gentry. The new branch site is located at at 320 East Main Street and the groundbreaking ceremony will begin at 10:30 a.m. on Friday, May 16.

When completed, the new 3,185-square-foot branch will nearly double the space of the current branch and will have an updated layout and look. This new branch will replace the branch building next door, which will remain open during construction.

Food distributor Ben E. Keith announced more detailed plans to expand its North Little Rock facility with a $60 million, 300,000-square-foot investment that will add 74 new jobs.

The company first announced its North Little Rock expansion in December 2013. The food service products distributor now employs 260 workers in Arkansas that pay an average wage of $33.75 per hour. State economic development officials said the expansion project was competitive with surrounding states, but Arkansas’ overall package secured the deal.

The expansion will develop a state-of-the-art distribution center in North Little Rock and will serve as the company’s Mid-South regional headquarters. The addition will consolidate Ben E. Keith’s facility at the Port of Little Rock into the North Little Rock facility.

Ben E. Keith serves all of Arkansas and parts of Louisiana, Oklahoma, Mississippi and Tennessee. Company officials said growth in the culinary and restaurant industries in the region, as well as a push for more market share, led to the expansion efforts.

Gov. Mike Beebe disclosed that $2.27 million from the Quick Action Closing Fund and performance incentives from the state were provided for the expansion. The fund currently has a low balance and Beebe said the next governor would be expected to deal with the incentive pool to remain competitive for economic projects.

The expansion was also aided by a $1.5 million grant from the U.S. Commerce Department’s Economic Development Administration (EDA) that will help North Little Rock build its energy infrastructure for commercial enterprise development.

Construction should begin mid-summer and may take 18-20 months to complete.

Ben E. Keith moved into Arkansas in 1973 when it purchased the Dillaha Fruit Co.

Arvest Bank has responded to the Benton County Circuit Court in the countersuit filed by First National Bank of Fort Smith, and in the response denies that it had any knowledge whatsoever of a control agreement and letter issued by Chad Evans as executive vice president. 

First National Bank of Fort Smith claimed that it had followed protocol by obtaining a signed control agreement on the collateral being pledged by then Arvest executive Dennis Smiley, for loans being granted by FNB. The signature of Chad Evans, intermediary for Arvest Bank, is present on a letter and the security control agreement for Smiley’s loans with First Nation Bank. 

Arvest also says in the filing that the account number ending in 586 referenced in the letter which was said to contain the assets being pledged for collateral was a fake. Arvest said in the filing there was never any assets in the an account ending in 586.

Lastly, Arvest said the control agreements were signed in the capacity of Arvest Bank — not Arvest Bank Group, the true holder of the stock. Evans is still employed at Arvest Bank, as are two other executives whose signatures appear on collateral pledge forms for loans made to Smiley.

Arvest asked the court to dismiss the suit and require the plaintiffs to cover all the legal costs involved in this proceeding.

SMILEY SR. RESPONSE
Henry Dennis Smiley Sr., the father of Dennis Smiley, also was sued by First National Bank for loans made to HDS Holdings, Smiley senior filed his answer with the court on Monday (May 12). The senior Smiley notes that he did not sign any loan documents with First National Bank of Fort Smith, and that someone signed his name without his knowledge.

The senior Smiley claims he was a victim of fraud in this matter and his counsel asked for a jury trial. He asked the court to dismiss the case against him and HDS Holdings because they knew nothing of the transaction made in their name. First National Bank is owed $50,000 on loans made to HDS Holdings and $144,258 made to Dennis Smiley in 2013.

Simmons First Bank also sued Smiley Sr. for loans it said it made to HDS Holdings beginning in 2008. Simmons loaned and renewed loans to HDS of $85,000 and $30,750. There was a balance owed of $84,816 as of April 11 when Simmons asked the court for a judgment against Smiley Sr. and the HDS Holdings.

The senior Smiley has also filed his answer with court on the Simmons suit. Again Smiley Sr. said he did not sign any paperwork relating to loans for HDS Holdings. He said his name was signed without his knowledge or consent.

Smiley Sr. again claims he was a victim of fraud perpetrated in his name without his will or knowledge. He is asking the court to consider a jury trial, if it choses to proceed forward.

Consumers tempered their spending in April despite weather improvements, as retail sales remained flat against stronger March spending patterns, according the National Retail Federation. 

April retail sales, which exclude automobiles, gas stations and restaurants, were unchanged seasonally-adjusted month-to-month on the heels of a 3.6% bump upward in March. That said, retail sales increased 4.7 % unadjusted year-over-year. 

“The shift in Easter to April did not provide enough bounce to retailers as retail sales struggled to keep their strong spring pace,” NRF President and CEO Matthew Shay said. “With consumer spending accounting for roughly 70% of total economic activity, NRF remains hopeful that the uninspiring April retail sales figures are just a temporary seasonal fluctuation.”

The U.S. Census Bureau also reports retail sales, which are inclusive of automobiles, fuel and food. They report April sales of $434.6 billion, up 0.1% month-to-month. The Census Bureau said retail sales increased 4% on an adjusted year-over-year basis.

“Even though retail sales were weaker than anticipated, the fundamentals of the economy, including improving job growth and income gains, remain positive,” NRF Chief Economist Jack Kleinhenz said. “While the shift in Easter played into the seasonal figures, NRF remains optimistic that retail sales will keep their positive trajectory, albeit in fits-and-starts, in the second quarter.”

The nation’s largest retailer Wal-Mart will report its fiscal first quarter earnings on Thursday (May 15). This quarter includes the months February, March and April. Wall Street is awaiting the results as Wal-Mart is seen as a barometer for the broader economy. The retail giant’s sales comprise roughly 10% the nation’s retail spending, excluding automobiles. The average family of four spends $4,000 a year at Wal-Mart and one in every four grocery dollars are spent at Wal-Mart.

The consensus estimate among analysts who cover Wal-Mart Stores is that the retailer will post per share earnings of $1.15 on revenue of $116.29 billion. Both estimates are slightly higher than actual income and revenue in the same quarter in the previous fiscal year.

Segment Sales Gainers (year-over-year)
• Building materials, garden equipment and supply sales increased 2.7%
• Clothing and accessory sales increased 5.2%
• Furniture and home furnishing sales increased 3.6%
• General merchandise sales increased 5.3%
• Health and personal care sales increased 6.6%
• Online retailers’ sales increased 5.8%

Segment Sales Losers (year-over-year)
• Electronics and appliance sales decreased 1.8%
• Sporting goods, hobby, book and music sales decreased 0.6%

Behavior-based marketing services agency Catapult has named Scott Caldwell as the senior vice president, and that he will be based in Bentonville and report to Heidi Froseth, executive vice president and team leader of the National Retail Team.

Caldwell has more than 15 years of experience in consumer packaged goods marketing, shopper marketing and advertising, with a history of working for vendors supporting with Walmart and Sam’s Club.

According to Westport, Conn.-based Catapult, Caldwell will help spearhead growth through account leadership, new business development, community relationships and personnel development. His responsibilities will entail calling on both client corporate marketing and retail shopper teams to build relationships and drive results.

“The creation of this position will enable the current Catapult Bentonville team to focus 100% of their energies on current client opportunities and solutions, allowing Scott to manage business development. This is a commitment to growth not only in new assignments, but also to enhance service to our existing client base in Bentonville,” noted the Catapult statement.

Most recently, Caldwell was senior vice president-marketing services,for CJRW, a Little Rock-based based advertising agency with offices in Northwest Arkansas. He previously held leadership roles with agencies Blackwood Martin, Geometry Global and The Mars Agency. He client work includes cClorox, Kimberly Clark, Tyson Foods, Campbell’s, Pfizer, Bayer, Nice-Pak, and Nestlé.

Catapult, a subsidiary of Irving, Texas-based Epsilon, has 300 employees in 11 different locations.

For Mercy patients in the Fort Smith and Northwest Arkansas areas, the next trip to the doctors office may not include shaking the doctors hand. Instead, the healthcare provider's patients could soon see their doctors on a television screen and undergo a virtual examination.

If it sounds far fetched, you may not be wrong, according to Mercy Clinic president Dr. Cole Goodman, who said the idea of virtual examinations was something he was not sure would have been on the horizon even three years ago.

But Tuesday (May 13), Mercy Health System joined its 32 hospitals in four states — including its hospitals in Fort Smith and Rogers — for a virtual "groundbreaking" event, making the start of construction on the nation's first virtual care center.

According to Lynn Britton, the healthcare system's president and CEO, construction of the Chesterfield, Mo., – a suburb of St. Louis – virtual care center will allow Mercy to reach patients across the nation with specialists without having to leave the comfort of their local medical clinic.

"Telemedicine lets us provide the best possible care to people where and when they need it — even when patients wouldn't otherwise have access to specialists, such as neurologists and pediatric cardiologists," he said. "The center will bring together the nation's best telehealth professionals to reach more patients, develop more telemedicine services and improve how we deliver virtual care through education and innovation."

The new virtual care center will be a four-story, 120,000-square-foot building that will house 300 physicians, nurses, specialists, researchers and support staff, according to Mercy.

"This is a great day for Mercy and our Northwest Arkansas community. This virtual care center will create access to the best and brightest physicians in the country while allowing the convenience to our patients and their families right here in their hometown,” said Eric Pianalto, Mercy NWA Hospital president.

Patients will receive care any time day or night "via audio, video and data connections to locations across Mercy as well as outside of Mercy through partnerships with other health acre providers and large employers." The healthcare provider expects to log more than three million telehealth visits in the next five years.

An example of what may be more prevalent recently played out in Northwest Arkansas. According to a story in The Kansas City Star, Bob Quinlan, a resident of Rogers, Ark., traveled to St. Louis in August to correct his atrial fibrillation.

“Rather than make the nearly seven-hour return trip for a checkup, Quinlan drove to the Mercy hospital in his hometown. There, monitors allowed his St. Louis specialist to see how Quinlan's heart was functioning, even listen to his heartbeat through a stethoscope connected to a computer,” the story noted.

Quinlan, in a statement provided to The City Wire by Mercy NWA, said the technology provided a health benefit.

“Being able to see my specialist in St. Louis right here in my doctor's office is convenient. It's much easier for me to take an hour out of my day than take a day and a half trip to follow-up and stay on top of my health,” Quinlan said in the statement.

And while the virtual care center is not slated to open until 2015, Mercy Fort Smith President Ryan Gehrig told a crowd assembled at his local facility that telemedicine was already in use across the healthcare system's hospitals.

"We're already using telemedicine in a lot of avenues. Mercy SafeWatch eICU — as you may know, Mercy has the largest virtual ICU network in the country and we are one of the community hospitals that has that (infrastructure)."

Goodman said with the rise of telemedicine and anticipation of the virtual care center, Mercy Clinic is constructing new clinics with the infrastructure installed to handle telemedicine, allowing patients to see specialists when needed.

Gehrig explained that having the virtual care center and telemedicine capabilities allowed the hospitals across the system to bring specialists into the local market, meaning that while recruitment of specialists to the region would continue, patients would no longer have to travel out of town to get needed care.

Mercy Fort Smith Chief Operating Officer Matt Keep said even if Fort Smith or Northwest Arkansas clinics and hospitals under the Mercy banner land a specialist and no longer need to virtually connect to one, it would not stop them from providing services to other clinics across the system.

"We'll still obviously recruit for the needs that we have in our community. A good example in this is two ways. It's not just services that we'll be receiving from a virtual care center. We have physicians that are already part of working through the virtual care center. Our neurologist is doing teleneurology for other communities. When he has some downtime, he's volunteered to do that. So he's taking care of patients in other communities."

Gehrig said the patient capacity for the virtual center would be practically limitless, with such a large number of specialists on hand in Chesterfield and others available throughout the system.

It was a point Britton made, as well, as he pointed to Mercy's more than 10 years experience in telemedicine.

"We've pioneered a telehealth plan that no longer limits advanced care because of age, illness or geography. We can deliver a higher level of care to more people, and the virtual care center is at the heart of it — providing care for today while also developing the health care of tomorrow."

The small business sector has languished in the ongoing economic recovery well behind big business that has pushed Wall Street stocks to new highs this year. But a recent report by Wells Fargo indicates the tide is turning for small businesses. 

After jumping 21 points in the first quarter of this year, the Wells Fargo Small Business Index edged up an additional two points during the second quarter. All of the second quarter’s improvement came in the expectations series, which rose four points to 33. 

The only hitch in the report was that small business owners’ views on the present situation slipped two points during the quarter to 14. This drop may have been tied to the unusually harsh winter weather experienced in much of the country this year, which cut into sales and boosted expenses for many businesses, according to Mark Vitner, senior economist at Wells Fargo.

Despite the small drop, the overall index trended higher during the quarter and is now at its highest level in six years. More business owners see conditions improving this year than at any other time since the recession ended. The rise in optimism is also reflected in attitudes toward capital spending and hiring, which both improved during the quarter.

About one in three small businesses surveyed said revenues stayed essentially the same over the past year, which is the highest reading in the survey. Another 21% said revenues decreased a little over the past year and 11% said revenues decreased a lot. The proportion of businesses reporting that year-to-year revenues increased has remained fairly stable at around 36% for the six quarters, Vitner noted.

FURNITURE UPSWING
One of the small business sectors showing optimism is furniture and home furnishing companies. After several years of slow growth, furniture executives that finance consumer purchases are more optimistic about the future of their sector.

Mike Hudgens, an executive with CIT Commercial Services, a finance company that makes loans to small businesses and middle market companies, said a rebound in housing has furniture companies expecting growth this year."

“Our furniture sector clients are doing well and feel confident about the future,” said Hudgens. “Optimism is the highest we’ve seen in years, and it looks like the market should continue on an upward swing, though it may never comeback to the extent it was prior to the recession.”

With growth in the housing market and increased jobs numbers, many American consumers who postponed furniture purchases may replace their older furniture units. He said the merging of furniture with smartphones and tablet technology, are taking root to meet consumer demand. Furniture with these innovations are being sold through non-traditional channels and seeing solid success.

James Smith, founder of Springdale-based James+James, said his custom wood furniture business continues to grow as more consumers are willing to purchase furniture online. His e-commerce furniture manufacturing operation has grown from two to 15 people since 2011, and he’s selling and shipping furniture to consumers in 45 states, Bermuda and Canada. He plans to add a retail space for his furniture in the Dallas market later this year.

Smith built his company through social media (Facebook and Pinterest) and continues to glean new customers each week from shared posts of satisfied customers.

“It’s hard for me to gauge how much my company will grow this year, given the rapid run we have already experienced,” Smith said.

The company grossed about $250,000 in sales in 2012, before offering delivery. In 2013, sales revenue grew to $1 million and Smith’s best estimates for 2014 is $1.5 million. He attributes the growth to more people getting comfortable with online purchases of furniture and the desire for custom American made real wood products.

“The 30-somethings are just now starting to buy furniture outside of Walmart and Ikea and they are shopping online for custom pieces that are made in the U.S. by small businesses like us,” Smith said.

Smith said it’s good to see the small business sector responding positively because it’s important to the overall economic growth of the local region and beyond.

BUSINESS CONFIDENCE
The slow recovery of small business confidence as a whole continues to lag pace behind previous recoveries, Vitner said. The level of small business confidence is still about half of what it was prior to the recession. Small business confidence has recovered much less rapidly than CEO confidence, which likely reflects the greater ease and access that large companies have to the capital markets.

Vitner said it’s harder for small businesses to repair their balance sheets given that top-line revenue growth has been sluggish. Even with the slower recovery, Vitner said small businesses are spending more than last year, marking the first positive reading for this measure since the first quarter of 2008.

The rise in optimism also extends to capital spending and hiring, with more small business owners planning to increase capital spending and increase employment than any other time since the recession ended five years ago.

Wal-Mart Stores Inc. and Schneider Logistics Inc., have agreed to a settlement for $21 million for federal and state-level wage and hour violations committed at a Walmart warehouse facility in western Riverside County, Calif.

Under the terms of the settlement, Schneider will pay the entire $21 million in unpaid wages, interest and penalties for major wage and hour violations covering over a decade at the dedicated Wal-Mart facility. The settlement does not say if Wal-Mart will contribute to the settlement behind the scenes. Both Walmart and Schneider secured complete releases as part of the settlement.
 
The settlement applies to more than 1,800 workers who worked between 2001 and 2013 at three 100% Walmart-dedicated Schneider Logistics distribution centers in Mira Loma (Riverside County), Calif., in the case Carrillo vs. Schneider Logistics et al.  The facilities, operated by various warehouse companies for Wal-Mart since 2001, function together as the largest Walmart distribution center in the Western U.S.
 
According BerlinRosen, a public affairs firm representing union interests, the suit alleged major wage theft occurring over 10 years against “lumpers”-workers who load and unload boxes by hand from shipping containers and into trailers for Walmart. The workers, directly employed by loading/unloading companies Impact Logistics, Inc. and Rogers-Premier Loading and Unloading Services and/or Premier Warehousing Ventures, often worked double shifts –16 hours/day, 7 days per week with no required breaks or overtime premiums, and often for less than minimum wage. The workers allege they were instead paid by an elaborate piece rate that was found to be illegal and changed quickly after the suit was filed in November 2011.
 
In January, Federal Judge Christina Snyder ruled that Walmart would have to face trial as a potential joint employer, the first time a retailer would have had to stand trial for the actions of its warehouse contractors. Walmart had maintained that it had no control over these workers, but plaintiffs’ counsel argued that the presence of up to a dozen Walmart managers on site and the daily control over the work at every level made them both aware of and liable for wage and hour violations at the warehouse.

The $150 million Dynamic Fuels plant in Geismar, La., jointly owned by Tyson Foods and Syntroleum Fuels came online in November 2010, but has failed to live up to its original production goals of 75 million gallons of renewable fuel per year.

The idea of turning low grade chicken fat into renewable fuel was heralded news by Tyson Foods and its partner Syntroleum in 2009. Now the clock is ticking for Syntroleum and its financial future hinges on a shareholder vote on June 3 to sell all of its assets, including its 50% interest in Dynamic Fuels to Renewable Energy Group. Without approval to merge with REG, Syntroleum noted in its recent proxy statement that it’s likely looking at bankruptcy liquidation given it has run through its cash while the Geismar plant sits idle.

The plant has been idle since November 2012, costing each partner $1 million per month to keep the facility in standby mode. Aside from the $1 million cash burn per month, Ron Stinebaugh, executive with Tulsa-based Syntroleum, estimated in December the plant had lost out on roughly $20 million in potential sales as the partners could not agree on the restart terms.

The venture, despite all its potential, has been a money pit for thinly capitalized Syntroleum. For the quarter ended Sept. 30, 2013, Syntroleum reported a loss from Dynamic Fuels of $3.5 million. This compares to a loss of $3.3 million for the quarter ended June 30, 2013, while the plant has been on standby mode. There is a three month lag in the Dynamic Fuels report compared to Syntroleum’s regular reporting.

Syntroleum notes that it had reported income of $6.7 million from Dynamic Fuels in the December quarter resulting from its portion of a reinstated $1 per gallon tax credit from 2012. This income was offset by losses of $5.9 million in the quarter ending Dec. 31. Syntroleum said the equity loss of Dynamic Fuels for the quarter ended Mar. 31, 2014 was $3.4 million. 

Tyson Foods had no comment on restart plans when asked recently during a May 5 earnings call with the media. In a previous call Tyson Foods CEO Donnie Smith told The City Wire the plant would stay idle while its partner was shopping for a buyer. He said Tyson would be willing work with another partner if Syntroleum’s interest was sold.

The partners said the cost to restart the plant is an estimated $20 million, based on feedstock prices. As of March 31, Syntroleum's available cash position was $7.8 million, down from $11.4 million at the end of 2013.

Dynamic Fuels was idled in November 2012 because of deteriorating market conditions. The partners anted up $7.3 million in the spring of 2013 to replace a catalyst in the facility that is supposed to increase production efficiency. That catalyst was installed on June 28 and the plant was not started on the scheduled date of July 30, 2013.

Syntroleum encourages its shareholders to approve the sale to REG, stating that it was the best offer on the table and provides the greatest potential for shareholders to see more value in their investment.

“If the asset sale or another similar transaction is not approved and consummated on a timely basis, the Geismar Facility does not return to operational status on a timely basis, and/or Syntroleum does not obtain substantial new debt or equity financing on a timely basis, Syntroleum would not likely have sufficient resources to continue operations and may be required to seek protection under the U.S. Bankruptcy Code or similar relief. In such an event, it is possible that there would not be significant assets, or any assets, available for distribution to Syntroleum’s stockholders,” Syntroleum noted in its recent proxy statement with the federal Securities and Exchange Commission.

Syntroleum investors are already voting with their feet, as the stock price tumbled nearly 2% to $3.36 on Tuesday, May 13. Shares (NASDAQ: SYNM) were trading as high as $7.55 last July on hope the Geismar plant would soon reopen. Shares were trading slightly higher at $3.38 in mid-day trading on Wednesday.

Syntroleum has a market cap of roughly $33.4 million with 10 million outstanding shares. Renewable Energy Group (NASDAQ: REGI) has a market cap of $395.64 million with 37 million shares outstanding. Shares closed Tuesday, May 13 at $10.20 up 7 cents. Shares were trading down to $10.13 in mid-day trading on Wednesday.

Analysts with Raymond James & Associates said the deal between Syntroleum and Renewable Energy Group is a rare instance of corporate M&A in the U.S. biofuel industry. Buying individual plants and strategic partnerships have been far more common.

Analysts at Cannacord Genuity called the deal “positive, but risky.” The all-stock deal would diversify Renewable Energy into the “next generation” of renewable diesel. They noted the joint venture with Tyson, has been hampered by feedstock, catalyst and equipment failures.

Big Data feeds analytics well beyond point of sales data that used to be the be-all, end-all in retail forecasting. Today, retailers and suppliers are tapping “Big Data,” which encompasses market loyalty, store and site traffic, social media and mobile shopping in addition to point-of-sale and marketshare data.

Fred Baumann, vice president at JDA Software Group, recently spoke at the University of Arkansas Supply Chain Conference about how advanced analytics fed by Big Data are changing the supply chain. He said tapping smart analytics are the key to solving out-of-stock issues at retailers, because by leveraging information across social media more real-time demand can be accessed.

Baumann said category managers have the opportunity to integrate relevant real time data into their forecasting. He said advanced analytics also may improve assortments and space planning for the retail store. He said analytics within the supply chain have to be a connected collaborative framework between retailer and supplier.

“Manufacturers and retailers struggle to try and solve their problems themselves, when they both want the same thing — productive shelves,” Baumann said.

Forecasting inventory to the shelf is the future, according to Baumann.

“Planing shipments to the shelf creates a ton more data than shipping to the distribution center. It is very granular and requires an interconnected collaborative framework with total transparency,” he said.

REAL TIME DEMAND
Ryan Frazier, CEO of DataRank in Bentonville, is a Big Data analytic service firm for retailers and suppliers. He said many suppliers are using analytics gleaned from Big Data to better understand real time demand.

Frazier said the present system used in retail to track product from the warehouse to the shelf is largely managed by employees using a paper trail. He said companies like Movista have sprung up to offer better solutions by helping retailers and suppliers save money on implementing efficient data collection and delivery practices.

The Big Data evolution has three distinct stages at this point, according to Frazier. He said it’s a very broad term and analytics can help with visualization and grasping the relevant information. He said knowing what is occurring is step one. Next, he said Big Data is typically used in forecasting demand with predictive and proactive analytics. The final stage is working with different “levers” to manipulate and make changes in real time data to obtain desired results.

Frazier and Baumann agreed that it’s important to find the right partners to work with in the Big Data space because being able to make changes in real time requires fast analysis. Frazier said moving from step two to step three is cumbersome to do alone.

Going it alone can be cost prohibitive given the talent needed in terms of engineers and hardware servers to process the data. Frazier said as searches against the data are needed, high powered servers and tech savvy are essential.

TRANSFORMATIONAL CHANGES
Dhiraj Rajaram, CEO of Mu Sigma, also was one of the featured speakers at the recent supply chain conference. Rajaram said the information age requires one to think in terms of the decision supply chain, moving away from the physical supply chain.

Rajaram defined Big Data by saying it is data engineering, data science with applied technology and math then layered with business context to create a stack. 

“Big Data will both drive and require transformation from businesses,” he said.

Keith Mercier, global retail leader at IBM Watson, said the impact Big Data and social media are having on retail is transformational. He said Pinterest, a four-year old company that is a virtual bulletin board, has reshaped the fashion merchandising sector. A case in point is Nordstrom, he said.

“They know merchandising, as a 100 year-old company, and Nordstrom is modeling its own merchandising after a four-year social media site (Pinterest) with its Pinned Shoes campaign,” Mercier said.

Nordstrom features the shoes on its site in order of popularity noted by the number of pins or likes gleaned from crowd sourcing.

Chris Spear, the new chief of legislative affairs for the active American Trucking Associations’, has Arkansas connections and his former Arkansas boss says Spear “has the experience and the skills” to handle the “bigger-than-life personalities” in the trucking industry and in Washington, D.C.

He’ll need all the experience and skills he can muster. Ongoing work to draft a new federal highway bill, a push to adjust driver hours-of-service regulations and lobbying over other key issues for the trucking industry pushed Spear straight into the Capitol Hill legislative battles.

However, he’s not unfamiliar with the industry. Part of his trucking industry knowledge comes from his years lobbying for Arkansas issues, which included being aware of the governmental affairs positions of companies like Lowell-based J.B. Hunt Transport Services, Fort Smith-based ArcBest Corp. (formerly known as Arkansas Best Corp.), and Little Rock-based Maverick Transportation.

Spear, who has been with ATA for several weeks, served in 2000-2001 as legislative director for Arkansas issues with U.S. Sen. Tim Hutchinson, R-Ark.

Prior to joining the largest lobbying group that represents the U.S. trucking industry, Spear was VP of emerging markets and government relations for Honeywell. He also has worked as assistant Labor Secretary during the George W. Bush administration, and as a staffer for the U.S. Senate labor committee. He earned a bachelor’s and master’s degree from the University of Wyoming.

“Chris has a long career on Capitol Hill and in the federal government and we’re thrilled to have him as part of our advocacy team,” ATA President and CEO Bill Graves said in a statement. “Chris also brings a wealth of experience from the private sector which benefits our vital industry as we pursue our legislative priorities on Capitol Hill.”

Hutchinson told The City Wire he was not surprised Spear was hired for the high-profile job. In fact, he recommended to the ATA that Spear be hired.

“I lost a lot of good staffers to the Bush administration and Chris was one of the best,” Hutchinson said. “He’s got all the tools that I think you need for that position. He’s got Hill experience, obviously. ... He’s got relationships all over Congress. He’s well known and well respected.”

Hutchinson said he is confident Spear and “everyone at ATA certainly understands that Arkansas is pivotal” in the national trucking industry.

HOURS OF SERVICE ISSUE
Although the lobbying laundry list is long for Spear, his immediate priority is to help the industry convince Congress to adjust hours-of-service regulations implemented in June 2013.

“The goal of this rulemaking is to reduce excessively long work hours that increase both the risk of fatigue-related crashes and long-term health problems for drivers,” noted a statement from the federal Department of Transportation.

The rule reduces a driver’s average maximum allowable hours of work per week from 82 hours to 70 hours, a 15% reduction. The 15% reduction in the average maximum allowable hours of work based on the new rule results from the restrictions on the use of the restart period.” The DOT estimates that the new rule will boost annual trucking industry expenses by about $470 million, but said benefits from safety, driver health and other factors will produce an overall net economic gain of up to $280 million a year.

Officials in the trucking industry have said the rules do nothing to promote safety and instead merely drive up costs for the industry which are then passed on to consumers.

“The agency used logic that forcing break, rest, or driving periods at a particular time was a one size fits all proposition. Cardian rhythms and all types of fuzzy math were introduced by people that have never experienced being in a truck,” Greg Carman, president of Fort Smith-based Carman Inc. and a board member of the Arkansas Trucking Association, said in a December 2013 story on the issue.

Spear said the hours-of-service rules also are exacerbating a driver shortage in the industry.

“This is one our members want us to act on immediately,” Spear said of the rule, adding that “there are some unintended consequences with this rule. We’re not trying to roll back safety.”

One consequence is that the rules push drivers on the road at peak times instead of letting them drive at hours when the general public is not on the road, Spear said. He argues that is counter to the claim of federal regulators that safety is the focus. Spear said there is a “really receptive audience on the Hill” to modifying the rules, but he’s also realistic about Congressional action during a political season.

“This is a very dysfunctional environment in Washington and this is a mid-term election cycle, so there is not a lot that will get done,” Spear said.

FEDERAL HIGHWAY BILL
He also said the dysfunction is likely to stall approval of a new long-term federal highway bill. Approval of a new bill is critical for many reasons. The Department of Transportation estimates the highway account of the Highway Trust Fund will run out of money by the end of fiscal year 2014. Also, state governments may have to delay projects if they aren’t certain that federal highway dollars will be available to support project completion.

Also, proposed highway bill language includes changes in how the trucking industry may be taxed to support funding of national infrastructure improvements. Spear said the industry is open to user fee increases and other revenue possibilities, but would like to know specifics in order for the industry to have a better understanding of future expenses.

MAP-21, the highway legislation now used, was approved in June 2012 after almost three years of Congress approving short-term extensions of the previous law before enacting new authorization.

Spear said he is eager to return to Arkansas for a visit.

“I hope so,” Spear said when asked if he would soon have time to visit trucking industry officials in Arkansas. “I traveled all four corners and just really enjoyed the state. It’s very diverse and I really enjoyed the people. ... I want to talk directly (to industry leaders in Arkansas). That is the best way those of us in Washington can help the industry is to go to where they are.”

When Kyle Parker recently said progress was “moving quickly” on the establishment of a $58 million medical college in Fort Smith, he wasn’t kidding. The Arkansas Colleges of Health Education announced Wednesday (May 14) that Dr. Ken Heiles would be the dean of the college and that work to open the college for the first cohort of students could happen a year earlier than planned.

Parker, the president and CEO of the Fort Smith-based Arkansas Colleges of Health Education, said Heiles and wife Michelle are expected to be in Fort Smith on Thursday to look for homes. Heiles officially begins the job on June 1.

“I am very excited for the opportunity to help shape the future of the proposed College,” Heiles said in a statement from the ACHE. “This will be a tremendous asset to Western Arkansas and the entire state and make great strides in helping fill the need for medical professionals. My family and I look forward to becoming a part of the Fort Smith community.”

Heiles has been the associate dean of Graduate Medical Education at Lincoln Memorial University-DeBusk College of Osteopathic Medicine in Harrogate, Tenn. He is the current American College of Osteopathic Physicians Chair of the Committee on Education and Evaluation, past president of the Board of Governors, and also serves on the Bureau of Osteopathic Graduate Medical Education and Development. Prior to that, he served as the director of Medical Education of the Osteopathic Family Practice Residency Program, was responsible for the Family Practice Residency Program and a member of the full-time clinical faculty at the University Arkansas for Medical Sciences/AHEC in Pine Bluff, Ark.

“After interviewing multiple individuals from across the United States, we were able to get one of the most respected and influential deans at both the state and national levels. He’ll be instrumental in developing graduate medical education in and for both the state of Arkansas and the nation,” Parker said in the statement.

A fully operational osteopathic college is expected to serve about 600 students, and employ around 65 (full-time equivalent jobs) with an average salary of $103,000. That impact does not include adjunct professors that will be needed for the school. The school, to be located on Chaffee Crossing land (200 acres) donated by the Fort Chaffee Redevelopment Authority, was previously targeted to accept its first cohort of students in the fall of 2017. However, Parker said the hiring of Heiles and the planned submission in July of a feasibility study to the Commission on Osteopathic College Accreditation could result in construction beginning in early 2015 with the college opening in fall 2016.

“The key to that (opening early) is going to be hiring the faculty, and with the reputation of Ken Heiles, we feel very strongly that we can get that done,” Parker said.

Heiles’ hiring was praised by the regional medical community.

“Dr. Heiles’ hiring accelerates the process of setting up the curricula and the onboarding of faculty simultaneously with the construction of the building to start the College,” noted Dr. Cole Goodman, president of Mercy Clinic Fort Smith. “Dr. Heiles as Dean of the Osteopathic College is a major step in making the proposed COM a reality. Speaking as a physician and an administrator, we couldn't have asked for a better hire for the proposed College.”

In addition to Mercy Clinic, Fort Smith-based Cooper Clinic, Sparks Health System in Fort Smith and Summit Medical Center in Van Buren, will be some of the area medical facilities working with the college to provide residency opportunities.

There are 30 colleges of osteopathic medicine (COMs), offering instruction at 40 locations in 28 states. There is not an osteopathy school in Arkansas. Should the development of an osteopathic school in Fort Smith happen, it would be a private, non-profit institution and not dependent on continuous public funds from the state.

Heiles graduated from the Philadelphia College of Osteopathic Medicine in 1984 and completed his internship and residency at hospitals in Pennsylvania. He received the Distinguished Service Award from the American College of Osteopathic Family Physicians in 2013. He was also named the Arkansas Family Physician of the Year in 1993 and the Physician of the Year by the Arkansas Osteopathic Association in 2010.

“The selection of Dr. Heiles as our dean is a key step toward the opening of the proposed Arkansas School of Osteopathic Medicine,” John Taylor, board chair of the Fort Smith Regional Healthcare Foundation, said in the statement. “Dr. Heiles credentials are second to none. He has practiced previously as a physician in a rural area of Arkansas and served at the top levels of medical training and education. We say welcome home to Dr. Heiles and we look forward to an exciting mission together.”

Heiles’ hiring was well received in the osteopathic community.

“It is with great Osteopathic pride that we celebrate the selection of Arkansas’ favorite son Ken Heiles, D.O. as Dean, Arkansas College of Osteopathic Medicine. He is one of our own who has practiced and help train physicians in our state prior to being selected for this esteemed position.”
– Jim Zini, D.O., American Osteopathic Association Past President

“The ACHE couldn't have found a better leader to foster Arkansas' future physician workforce. We, as an association, have full confidence that Dr. Heiles will give his medical students the tools they need to address our state's healthcare demands. Dr. Heiles has a proven track record of being on the forefront of educating osteopathic medical students and establishing high quality graduate medical education sites. We proudly welcome home a nationally recognized osteoapthic leader and native son.”
– James Baker, D.O., Arkansas Osteopathic Medical Association president

“The Arkansas Osteopathic Medical Association (AOMA) is thrilled with the ACHE's hire of Dr. Ken Heiles. The AOMA and the ACHE share a mission for advancing our state's dynamic health care needs through advancing osteopathic education and outreach. As a Past-President of the AOMA, we know that Dr. Heiles shares this same vision and will work towards establishing a school founded upon the highest standards of osteopathic education.  Our association continues to wholeheartedly support the ACHE's efforts as they continue to pursue excellence in education with the announcement of the new Dean.”
– Frazier Edwards, executive director, AOMA

Arvest Bank has named Eric Buster as a community lender in the bank’s Gravette branch.

Buster has worked for Arvest Bank for the past two years. He began in Arvest’s customer service center and worked his way to senior financial sales representative and then commercial loan assistant.

“Eric has demonstrated a deep understanding of the type of first-rate customer service for which Arvest Bank is known,” Jim Singleton, Arvest Bank Community President, Gravette, said in a statement. “He listens to the customers’ financial goals and is diligent in helping them achieve those goals.”

A graduate of Greenwood High School, Buster attended the University of Arkansas at Fort Smith before transferring to Arkansas Tech, where he graduated in 2011 with a bachelor ‘s degree in biology.

Arvest Bank operates more than 260 bank branches in Arkansas, Oklahoma, Missouri and Kansas through a network of 16 locally managed banks, each with its own board and management team.

An area of highly contaminated soil at the former Whirlpool manufacturing facility has the company's environmental consultants proposing not just chemical oxidation treatments, as previously approved by the Arkansas Department of Environmental Quality, but removal of soil contaminated by potentially cancer-causing trichloroethylene (TCE).

And while the information is just coming to light, ADEQ said Whirlpool and its consultants knew about the contamination at Whirlpool’s former Fort Smith manufacturing operation even as it was presenting a remediation plan to the agency late last year and early this year.

In an April 24 memo, officials with ADEQ detail a telephone call with Project Manager Mike Ellis of ENVIRON, the firm Whirlpool hired to handle remediation efforts at its site following disclosure of TCE contamination, in which Ellis said his company had identified "an area of highly impacted soils to as deep as 25' - 30' have been located at the northwest corner of the Whirlpool building ... "

According to Ellis, ENVIRON believed the location was likely the source of groundwater contamination that has spread to the neighborhood north of the shuttered factory “and as such requires source removal,” he said. The process for removing the contaminated soil will require boring into the ground, Ellis told ADEQ, with the focus shifting from the chemical oxidation treatments approved in the company's remediation plan to "source removal."

"They want to focus on source removal and have bioremediation of groundwater become secondary until the source is removed," the memo read. "They are still planning to inject into the one injection point in Area 1."

Ellis also notified ADEQ that "a large quantity of contaminant mass (is) moving to the South." The memo also said drilling to remove the contamination "will generate high volumes of highly contaminated soil and groundwater that will require management."

In addition to the northwest corner of the Whirlpool building, the memo said contaminated soils were also found to the west and south corner of the closed factory, as well as areas under the manufacturing building.

It is unknown what impact the change will have on the remediation plan approved earlier this year, though the memo said, "In either case, the schedule for groundwater remediation in Area 1 will be impacted."

In discussing the revelations from Ellis, ADEQ said it would have to sign off on future actions taken at the site before such actions are taken.

"Although Whirlpool collected this MIP data 4-5 months ago, no discussion of the results or ramifications of this data was supplied to ADEQ," the memo continued. "MIP data is presented in real time. Whirlpool certainly knew that this area was impacted prior to submitting the final Remedial Plan at the end of February."

At a quarterly meeting between ADEQ and ENVIRON held via conference call Monday (May 12), ADEQ requested Whirlpool provide the following to speed up removal of impacted soils:
• Within 15 days, Whirlpool should submit a soil investigation work plan for the newly-discovered area of contamination;
• The work plan "should include proposed boring locations, depths, sampling protocol and a proposed analytical suite. A schedule should also be presented."
• Whirlpool should provide ADEQ with any information is receives "from the analytical laboratory."

In a letter to Whirlpool from Technical Branch Manager Jay Rich of the ADEQ Hazardous Waste Division, Rich said the company should propose an amended remedy for the contaminated area should lab analysis confirm the disclosed data discussed in April.

"Since a remedy for AOC 1 is already in the Remedial Action Decision Document (RADD), the RADD may need to be amended based on the findings of the investigation," he wrote.

Ken Nisch, chairman of JGA, has designed brick-and-mortar retail stores for nearly 40 years. He said digital is and will continue to transform the retail experience during the next three years as smart phone sales are expected to top three billion sold annually.

Gartner reports 1.8 billion smart phones were sold last year, with Apple and Samsung controlling half of the market.

Nisch said now it takes three year’s income for most Indian consumers to afford a smart phone. But with smart phone prices expected to fall to $35 in the next two or three years because of Chinese or low-end manufacturers, he said smart phone usage is expected to double.

Nisch was one of the featured speakers at the annual SHOP Retail Conference held at the University of Arkansas on Wednesday (May 14). The spring conference was presented by the Center for Retailing Excellence at the university in cooperation with this year’s sponsors, The Mars Agency, Walmart and Shopper Events.

CREATIVE RESPONSES NEEDED
The conference theme was “Growth through Creativity,” and Nisch said digital is prompting creative thinking among retailers and brands who want to move from being stuck in the middle out to the edges, where people are connected through high tech and “multiple touch points.”

“Digital is altering everything we do. Even jean makers have had to redesign pockets to allow for bigger smart phones. It’s where people go for information, scout for locations to shop, task their shopping lists. ... Consumers use phones to fill their idle time, engage in pre-shopping and social shopping,” Nisch said.

He said retailers must figure out how to engage a generation quite comfortable living on stage. 

“By the time they get to your store they have already decided what they want to buy and they expect you to help them find it quickly. They don’t want to browse, but there is an opportunity to sell up, for those who can engage these shoppers,” Nisch said.

David Shing, a “digital prophet” for AOL, and a speaker at Wednesday’s conference, said today’s shoppers have a “show me” culture as 85% of consumers watch videos from six-second Vine posts to YouTube. Shing said brands have to win over digital shoppers differently. They don’t conform to the traditional shopping patterns of past generations. 

“Consumers are creators, curators and critics rolled into one. They will recommend only 5 to 9 brands to their friends and family, so making that list is important,” he added.

Shing said the smart phone is the first screen in people’s lives. It’s not their big screen television or tablet. But he said mobile is often the last place brands get creative with their messages, content and advertising. 

“You should start with mobile, but for some reason it’s being treated as an infant when it comes to content marketing. I also believe that experimentation is absolutely necessary,” Shing said.

RETHINKING SHOPPING
Digital shoppers often want customization and edited choices, and this does not fit the traditional shopping warehouse model build around variety and one-stop shopping.

“The shopping ecosystem has to be rethought. There is really only two reasons to have a physical store, for the shopping experience or for the last mile logistics and instant gratification. Many retailers have built their models on embellished warehouses but that’s not the future,” Nisch said.

He recently attended a fashion retail conference in Spain and said the talk among several retailers from American Eagle to Aeropostale was to close underperforming stores and focus on fewer, more connected and experiential venues.

Nisch challenged those at the conference to think about ways they might make a physical presence an interesting experience. He said the Hershey store in Las Vegas has been a big hit as the brand seeks to engage shoppers with custom products they can create using a 3-D printer.

Before and after the shopping experience in the physical he said brands should also use digital to reinforce and engage those customers, like GAP and its experiment with Piperlime to start conversations with shoppers who are enroute to the store.

THE BRA STORY
Nisch said the new retail ecosystem is one that moves seamlessly between digital and physical. He said the physical may be a showroom, with various experience zones within it. The Jockey Bra store at the Woodfield Mall in Schaumburg, Ill., was one example he gave for a brand that has married digital and physical on a global scale with limited real estate.

He said Jockey focuses on the everyday bra, with just three colors and five styles that come in 55 sizes that are based on their own standard fitting guidelines. Shoppers can get the sizing kit and fit themselves at home with online assistance or come into the store for a personal fitting. But the store itself is designed like a showroom, with a spa feel. 

Jockey’s objective with their physical store was to create an innovative new bra shopping experience store. They accomplished this through direct consumer contact, online and brick & mortar. The store design allowed for individualized consultations and retail. It also provided a solution to the frustration associated with traditional bra shopping. 

Nisch said Jockey’s willingness to move toward to the edge with its store concept helped it create a “breakthrough moment” for the consumer. He said Jockey is able to expand its reach with a hub-and-spoke concept with pop-up stores that facilitate the one flagship store.

One observation by Jockey after opening the store last summer, was that many woman want to do the fitting in the privacy of their home, but then they talk a friend into coming to the store for a fitting and they tag along providing opportunities for another sale.

The volunteer auxiliary of Northwest Medical Center – Bentonville won the American Hospital Associations (AHA) award for volunteer excellence for their “Sock-It-To-Me” program collecting over 2,000 pairs of new socks for disadvantaged children in the community.
 
“We are thrilled to receive this award for a program inspired by the real childhood experience of one of our volunteers, “ JB Johannsen, president, volunteer auxiliary said.  “There was a time in her childhood during which she said, ‘Happiness was a new pair of socks.’  We were so moved, we took up the cause with a great shared enthusiasm.”
 
The formal awards ceremony was be held on May 5 in Washington, DC at the American Hospital Association’s 2014 annual meeting where Johannsen accepted the award on behalf of the local volunteer auxiliary.
 
The 2014 drive will generate donations of children’s underwear which is a much needed item for this underprivileged population.
 
“We feel blessed to be able to come together to help the children in our community in this way,” Cindy Sadler, volunteer Coordinator, Northwest Medical Center – Bentonville said. “Our volunteers not only give our patients their time and kindness, they then extend that generosity of spirit to the community!” “Our employees and now even some of our patients who have heard about the drive are giving to help us buy more for the kids,” she said.

Wal-Mart plans to fill up to 95 new jobs being created at its Neighborhood Market in Farmington that is slated to open this summer.

A temporary hiring center has opened inside the Walmart Supercenter located at 2875 W. Martin Luther King Jr. Boulevard in Fayetteville. Applications will be accepted from 8 a.m. to 5 p.m., Monday through Friday and applicants may also apply online.

According to store manager Jesse Pinkston, the store will be hiring both full- and part-time help.

“I began with Walmart in 1997 as an hourly associate and have moved my way up in the company. I look forward to meeting others who want to build careers here at Walmart,” said Pinkston.

The majority of new employees will begin work in July to help prepare the store for its grand opening. Walmart provides a benefits program to eligible full- and part-time associates.

Through Walmart’s Veterans Welcome Home Commitment, the company will offer a job to any qualified veteran who has been honorably discharged within the past 12 months. Interested veterans may find out more at Walmart Careers.

The foreclosure train is slowing across the Natural State, particularly in Benton County, that once led in the number of distressed homes. Irvine, Calif.,-based RealtyTrac reports 389 foreclosure filings in Arkansas during April, down 38.8% from a year ago. 

In Northwest Arkansas there were 39 new filings in Benton County and 19 new filings in Washington County, down 67% and 71%, respectively, when compared to the year-ago period.

The Fort Smith metro area had just 17 new foreclosure filings last month, 14 of those were in Sebastian County and three in Crawford County. Filings plunged 33% and 78%, respectively, in the two counties from the same month in 2013.

States like Arkansas continue work through the remnants of foreclosures left over from the recent housing crisis, according to Daren Blomquist, vice president of RealtyTrac. He said inventory levels are low and the foreclosures coming back into the pipeline will provide some much-wanted inventory for investors and buyers looking for rehab projects.

Vicki Briolat, agent with Crye-Leike Real Estate in Bentonville, said there are 153 foreclosure homes listed for sale in the local Multiple Listing Service among the four counties referenced in this report. The number of local foreclosure listings have declined from 273 in February and they are down from 322 in December. 

“We are seeing very few new foreclosures come into the market, and inventory is very low now. Homes in good shape are selling fast,” Briolat said.

A recent report by the Federal Reserve Bank of New York found that 3.7% of mortgages were at least 90 days delinquent in the first quarter of this year. This is down from 3.9% in the fourth quarter of 2013. 

About 145,000 individuals had new foreclosure notations added to their credit reports in the first quarter, 12,000 fewer than the previous quarter. At the same time new mortgage originations dropped by $120 million in the first quarter.  

Mortgage debt totaled $8.17 trillion in the first quarter, growing by $233 billion from the prior year.

Across the nation, RealtyTrac said 115,830 U.S. properties in April were in the process of foreclosure, down 1% from the previous month and 20% lower than in  April 2013. The report also shows one in every 1,137 U.S. housing units with a foreclosure filing during the month.

APRIL FORECLOSURE NUMBERS
Benton County: 39 filings, down from 118 in April 2013
Washington County: 13 filings, down from 19
Sebastian County: 14 filings, down from 8
Crawford County: 3 fiilngs, down from 8
Arkansas: 389 filings, down from 338

Officials with Wal-Mart Stores Inc. said bad weather and a currency exchange rate were partially to blame for a comparable decline in net income in the first fiscal quarter and total revenue that was just 0.8% higher than the same quarter in 2013.

The Bentonville-based retailer reported per share net income for the first fiscal quarter of $1.11, below the consensus estimate of $1.15. The company earned $1.10 per share from continuing operations. Total revenue of $114.96 billion was up slightly over the $114.07 billion in first quarter of 2013 and was below the consensus estimate of $116.27 billion.

"Walmart's first quarter net sales increased 0.8% over last year. Like other retailers in the United States, the unseasonably cold and disruptive weather negatively impacted U.S. sales and drove operating expenses higher than expected," Wal-Mart President and CEO Doug McMillon said in the earnings report released early Thursday (May 15).

Charles Holley, chief financial officer, said weather dinged net earnings some 3 cents per share in the quarter. Weather-related expenses included snow removal costs and the hiring of third party logistics services as a result of the major log jam in the supply chain from manufacturers to the distribution centers.

Bill Simon, CEO of Walmart U.S. said, the supply chain backlog created during several winter storms was the worst he has seen during his time at Wal-Mart. He said third party logistics were required to get the stores restocked quickly as there were delays from manufacturers. He said the 200 stores temporarily closed added to the weaker numbers.

The company said revenue took a $1.6 billion hit because of a currency exchange rate fluctuation. The company also paid $1.5 billion in the quarter to acquire “substantially all” of the outstanding shares in Walmart Chile.

Consolidated net income attributable to Wal-Mart was $3.6 billion, a decrease of 5%, related to higher core costs. Wal-Mart said it spent $53 million in compliance costs related to the Foreign Corrupt Practices Act. Approximately $34 million of that was linked to ongoing inquiries and investigations, and approximately $19 million was related to the retailer’s global compliance program and organizational enhancements. 

WALMART U.S.
The flagship sector, Walmart U.S. continues to feel pressure from weaker U.S. comp traffic, down 1.4% in the quarter, despite a 1.3% uptick in the average shopper ticket. This marks the fifth consecutive quarter of negative to flat comparable sales, the benchmark metric used to measure retail performance.

Overall, net sales totaled $67.852 billion at Walmart U.S., up 2%, led by strong results in grocery.

“We feel good about the underlying business and are pleased with the performance of Neighborhood Markets which recorded comp sales of roughly 5% and traffic increases of 4% in quarter,” Simon said during a media call. "We saw strength across food and health & wellness, and we're particularly pleased with our overall traffic trend. April marked the 46th consecutive month of positive comps for Neighborhood Market.”

He said as inflation has risen in meat and dairy, Walmart has been able to hold prices steady which has helped it gain marketshare in these categories. Simon said ticket averages are rising at its supercenter format, while traffic is heavier at the smaller formats.

Wal-Mart plans to offer its gas savings rollback program next month, an initiative that typically runs throughout the summer for customers who pay for their fuel purchases with a Walmart giftcard or store credit card. 

Going forward, Simon said the retailer will continue working to bring its e-commerce and physical stores into sync to provide a more seamless process for shoppers. The first fully tethered Walmart Express came online in North Carolina this month. Simon said shoppers may now stop to buy fuel at a Neighborhood Market and pick up a bicycle ordered online a hour earlier.

He is also excited about the new online grocery format coming to Bentonville. Simon explained that this concept depot is similar to other formats in its ASDA banner in the U.K., but it’s different in that the Bentonville center will be a wholesale warehouse where items are picked and packaged on site. He said orders placed online can be picked up an hour or 90 minutes later. Construction is already underway on this new format which is slated to open later this year.

A bright spot in the earnings came from the retailer’s e-commerce segment which grew sales by 27% in the quarter. On a comparable basis online sales rose 0.3% from a year ago. 

Walmart said its seeing double-digit sales growth from nearly all of its e-commerce and mobile commerce businesses around the world. Brazil e-commerce and Yihaodian in China continue to experience strong demand.

"We have the opportunity to create transformative growth through stronger e-commerce capabilities," McMillon said in the statement. "Our investments are focused on improving customer experience and fulfillment capacity. We're working to deliver a relevant, personalized and seamless customer experience across all channels to further grow sales."

INTERNATIONAL IMPROVEMENT
Walmart’s diverse international division has been working to rein in operating costs over the past few quarters. In the first quarter Walmart International reported total revenue of  $32.424 billion, down 1.4% including currency fluctuations. On a constant currency basis revenue was $34 billion, up 3.4% from a year ago. Operating income in the segment rose 3.4% to $1.202 billion.

“Our teams are executing key strategic initiatives and driving sales growth, while serving customers wherever and however they want to shop," said David Cheesewright, president and CEO of Walmart International. "We delivered on our commitment to grow operating income at a rate greater than sales, both reported and excluding currency."

The segment’s total results were negatively impacted by restructuring taking place in China and Brazil, two of its larger international markets.

SAM’S DISAPPOINTS
Once the shining star of the Wal-Mart portfolio, Sam’s Club has lost some of its luster and reported comp sales down 0.2%, while the average ticket down 0.3%. Net sales were $13.891 billion at Sam’s Club (including fuel), up just 0.1%.

“The fiscal year started with several challenges for our core member, resulting in one of our more difficult quarters. The combination of severe weather and the reduction of public assistance represented an approximate 90 basis point impact to comp sales,” said Rosalind Brewer CEO of Sam’s Club.

While traffic and average ticket sales declined in the quarter, membership and other income grew 10.5%. This jump was related to the fee increase taken a year ago. Sam’s said new member signups were softer to start fiscal 2015.

To spur more spending Sam’s is rolling out a cash back rewards initiative next month. This new benefit provides $10 for every $500 spent on qualifying purchases. All members will continue to receive Instant Savings offers; however, the benefit of cash rewards will be exclusively for Plus members, the company said.

This cash rewards plan has been tested in the Texas market with positive results. It is now being rolled out nationwide.

FORWARD LOOK
The company expects second fiscal quarter financials to be similar to those in the same quarter of 2013.

"We expect second quarter fiscal year 2015 diluted earnings per share from continuing operations to be between $1.15 and $1.25. This compares to $1.24 last year," Holley said. "Our guidance assumes incremental investments in e-commerce, headwinds from higher health care costs in the U.S. and increased investments in Sam's Club membership programs. We continue to expect our full-year effective tax rate to range between 32 and 34 percent. We expect our effective tax rate to be at the high end of this guidance for the second quarter."

Jan Kniffen, CEO of J. Rogers Kniffen Worldwide CEO, said Wall Street knows the first quarter was bad, but what it is looking for from retailers reporting earnings today and tomorrow is that the first six weeks of this quarter has been better and they are expecting a strong half of the year.

That is not what Wal-Mart or Kohl’s projected in their Thursday announcements, with both gave cautious guidance. Simon said their shopper base is still struggling to overcome stagnant wages.

Street.com analyst Jim Cramer said it’s not that Wal-Mart has lost its way, and it’s also not that Wal-Mart is merely a play on the low-end consumer woes like food stamps and government stimulus, but it’s also a realization that consumers are shopping elsewhere.

Negative traffic despite the company's investments is “very reflective in how people are now shopping and the company not being able to fully play in that trend,” said Brian Sozzi, CEO of Bellus Capital Advisors. He also notes that five consecutive “earnings warning” is an indication Wal-Mart continues to face “deep” issues. 

Wal-Mart shares fell 2.5% in the morning session trading at $76.83, down $1.90 on the day. During the past 52 weeks the share price has ranged from an $81.37 high to a $71.51 low.

Seeking Alpha contributor Brian Gilmartin notes that Wal-Mart is fairly valued at $80, given its ability to generate cash which it’s returning to shareholders in dividends and stock buybacks.

He said Wal-Mart’s long-term challenge is to grow revenues at something more than "low single-digit" percentages in an environment where GDP grows 2% (maybe) per year, and inflation persists at 1% to 1.2% per year.

Crawford County posted its first drop in real estate sales for the year, while Sebastian County posted its largest increase so far for the year. But according to one real estate agent, observers and analysts should not read too much into a single month's real estate sales.

For the month of April, Crawford County posted only $4.4629 million in sales on 44 homes, a 9.98% drop from the previous April's total of 50 homes at $5.142 million. Sebastian County, on the other hand, saw 120 homes sold at $14.158 million, posting a 25.76% increase over April 2013's sales of 96 homes for $11.258 million.

Kevin King, principal broker and owner of Weichert Realtors King Realty Group in Fort Smith, said analyzing a single month's numbers only tells a small part of the real estate story and said a review of a full quarter or a full year's numbers would give more insight into what was happening in the market.

For the first four months of 2014, Crawford County posted a 34.96% increase in sales over the same period in 2013, with 176 homes sold for $18.997 million in volume versus last year's sales of 136 homes for only $14.076 million. The same period saw Sebastian County with 376 homes sold at $48.610 million, a 7.28% increase over 2013's sale of 343 homes at $45.313 million in volume.

When it comes to the increase for both counties, King said it could be attributed to different factors. In the case of Crawford County, the driving force behind its growth continues to be the USDA's Rural Development Loan Program, which was at risk of expiring before Congress ultimately passed a Farm Bill that secured additional longer-term funding for the program.

He said rural development loans often drive people to Crawford County instead of rural parts of Sebastian County.

"For whatever reason, Van Buren is their first choice to do that RD loan," he said. "It's the next biggest city they can live in and use that rural development loan."

In addition to the rural development loans driving traffic in Crawford County, King said another factor in improving Sebastian County's sales could be the shift in seasons.

"The only thing I can think of from our perspective is we were slowed down the early part of the year because of the weather. There were several days where we couldn't even show."

With the weather improved, Sebastian County's numbers are on the rise.

As far as what types of homes are selling, King said the market has seen a large number of investors.

"About a third of our traffic is attributed to investors buying the lower-end housing," he said, adding that difficulty for individuals seeking mortgages is helping to drive more investors to gobble up available inventory.

"In a market where it's hard to get approved and rentals are in high demand, it helps (to have investors will to purchase)."

Even so, King said the market is still unbalanced with a lot of sellers, but very few buyers. But he said that should begin to change as the year advances.

"I think we're still a bit unbalanced with too much inventory and not enough buyers, but as we get more job announcements, I think that will help. The more balanced the market gets as far as buyers and sellers, it will help."

Home Sales Data (January - April)
• Crawford County
Unit Sales
2014: 176
2013: 136

Total Sales Volume
2014: $18.997 million
2013: $14.076 million

Median Sales Price
2014: $91,800
2013: $101,900

• Sebastian County
Unit Sales
2014: 376
2013: 343

Total Sales Volume
2014: $48.611 million
2013: $45.313 million

Median Sales Price
2014: $116,500
2013: $109,900